SINGAPORE Cries of "buy" and "sell" ring out in the chandeliered ballroom of the Shangri-la Hotel here.

Young men and women gather in several huddles, frenetically bargaining. They are surrounded by banks of computers blinking incessant changes in currency exchange rates.


"They just bought from us - er, no, we just bought from them," one perplexed young man tells a colleague.


The confusion is understandable. The young man and the other twentysomethings in the room are having their first experience with currency trading. Some are raking in big profits; others slipping deeper and deeper into loss.


Fortunately for the losers, it is only a simulation, part of a training exercise arranged by Citigroup Private Bank.


And, in reality, even losses of tens of thousands of dollars would not make much of a dent in the personal holdings of this group: They are the sons and daughters of the mega-rich of Asia and the Middle East, going to class to learn how to manage the family wealth.


Over the course of a week, 60 participants, several of them the offspring of billionaires, gain insights to help prepare for the day they inherit the family fortune. They learn a little about capital markets, hear lectures on planning to succeed their parents in the business and, of course, try their hand at money-market trading, with mixed results.


The program is designed to make rich families think more actively about how to pass on businesses and wealth and reduce the risk of the next generation's blowing its inheritance.


"I think it's very important for us to protect the legacy of our families," said Abdul Al Romaizan, the 24-year-old scion of a Saudi family whose empire spans jewelry, real estate, construction and car-components businesses in the Gulf countries.


All those in the course with him in Singapore are "in the same boat," he said. "The challenge is not only to follow our family's footsteps but take things to the next level."


It is a challenge that many children fail. Studies by researchers in the United States show that there is a lot of truth to the adage that the first generation makes the wealth and the second generation loses it. One recent investigation of 335 management transitions in U.S. family firms showed sharply lower performance when the chief executive's job went to a descendant of the founder rather than to an outside professional.


Managing the transfer of family businesses and wealth is an issue of growing significance in Asia, where financial analysts and bankers say that, over the next decade, a large number of companies will pass from their now elderly founders to the second generation.

At some companies in the region, like Hyundai and SK Group in South Korea, that transition has already occurred.


Across more than 27 countries, families control an average of more than 53 percent of publicly traded companies with market capitalization of more than $500 million, according to a 1999 study that a team of U.S. researchers published in The Journal of Finance.


In Asia, however, the percentage is much higher. Nearly two-thirds of companies in the region are family owned, many of them created during the growth spurt enjoyed by Asia's economies since the 1960s. A high proportion of the firms are still controlled by the people who started them.


Yet as these founders face their own mortality, along with the rest of the baby-boom crowd, there are concerns that too many may have put insufficient thought and planning into the transition to the next generation.


A World Wealth Report released in June by Capgemini and Merrill Lynch found that 45 percent of financial advisers to "midtier millionaires" - those with personal wealth of $5 million to $30 million - said their clients were "ill-prepared to pass on their wealth to their heirs." Taken together, the report concluded, the evidence points to "a storm brewing around wealth transfer."


Francisco Pérez-González, an assistant professor at Columbia Business School in New York, found that family chief executives are much younger on average than professional appointees.

Generally, they also harm company performance. After studying management transitions since 1994 in firms with a high concentration of family ownership, he found that return on assets fell by 18 percent and the ratio of market value to book value of the companies fell by 14 percent within three years when a relative of the controlling family took over.

What is more, as a group they "increase overhead or are associated with higher costs of goods sold," Pérez-González said. Sales fall from an average of 8.5 percent annual growth before a family succession to 3.6 percent growth after such a succession, he found.

A separate study whose authors included Belén Villalonga, an assistant professor at Harvard Business School in Cambridge, Massachusetts, found the problem occurred at the first transition: That is, when a company passed from the founder to the second generation. Later transitions appeared to be relatively smooth, she said in an interview.


Family firms usually outperformed nonfamily firms when the founder was active as chief executive or as chairman with a hired chief executive, Villalonga's study found. Once the company was handed to heirs, the situation reversed.


Al Romaizan is typical of the new business-school-educated generation. For him, learning the ropes in the family business in Saudi Arabia requires taking a few risks and changing entrenched family habits.

After being appointed deputy managing director of its jewelry business two years ago, he pushed his publicity-shy family to implement some of the marketing ideas he had learned at the University of Arizona.

"I know what the family wanted to do in keeping a low profile, but marketing is essential," he said.

If we do not tell you this will change the lives of many people, I really difficult to forgive myself. Terrific. at home can get six of the median income. everyone can do this! www.freedom.ws/yahooi 中文 www.yahooboss.ws